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Reports US

US stock market, economy and companies update (January 03, 2014)

January 3, 2014, Friday, 16:51 GMT | 11:51 EST | 21:21 IST | 23:51 SGT
Contributed by Trade The News


***Notes/Observations***
- The 10-year Spanish and Italian spreads against German government bonds move below 200bps for the first time since mid-2011
- China Dec Non-manufacturing PMI posts its 2nd consecutive decline to hit a four-month low (54.6 v 56.0 prior)

- Yesterday, US equity markets saw their first down day for the opening trading session of the year since 2008. Ironically, this was also the first negative YTD session for major indices in two years. Curious statistics aside, markets are back to modest gains this morning, with trading volumes pretty light thanks to lingering holiday absences plus the monster storm freezing out the Northeast. As of writing, the DJIA is up 0.21%, the S&P500 is up 0.25% and the Nasdaq is down 0.15%.

- Crude futures sank further this morning, dropping another buck to $94.50 from around $95.50 yesterday. In FX, EUR/USD is testing the 1.3600 level for the first time since early December.

- CNBC is reporting that activist investor Carl Icahn has bought 30-40 million shares of Hertz, and the stock is getting a nice lift. Earlier in the week, the company adopted a one-year shareholder rights plan and disclosed that it had had "dialogue" with a number of shareholders. Speculation immediately about who was looking to stir up trouble, with more than one trader suggesting it might be Icahn.

- Network security firm FireEye has a $1.05B stock-and-cash deal in hand to acquire Mandiant, which has become known for its forensic investigations of IT security breaches. Mandiant is best known for publishing a detailed report in early 2013 about a Chinese military hacking group in Shanghai responsible for hacking hundreds of companies and organizations in the US. FireEye also hiked its Q4 revenue guidance, citing the acquisition. Shares of FEYE are up more than 30% on the deal.

- Both Ford and Chrysler reported their best December results in years this morning, although totals fell short of consensus expectations. Ford's US sales grew 1.7% in the month, while the company's 2013 US sales increased 10.8%. Chrysler sales grew 6% y/y, with 9% growth in 2013 sales, its best year of growth in six years. General Motors saw a 6.3% decline in sales in December, widely missing expectations. Toyota's December sales declined 1.7% y/y. Shares of TM are flat on the day, while shares of Ford are down slightly. GM tanked 4% on the move, but ticked right back up to -2%.

- Shares of T-Mobile are down 4% or so after AT&T said it would throw in $200 to any customer who switches to their network from the T-Mobile network. The $200 bonus would be in addition to up to $250 of the trade-in value of the switcher's old device.

***Looking Ahead***
- 12:45 (US) Fed's Plosser Speaks at Economics Conference in Philadelphia
- 13:30 (US) Fed's Lacker Speaks on the Economy in Baltimore
- 14:30 (US) Fed's Bernanke Speaks at Economics Conference in Philadelphia
- 16:00 (CO) Colombia Dec PPI M/M: No est v -0.3% prior; Y/Y: No est v -1.3% prior
- 17:00 (US) Dec Total Vehicle Sales: 16.00Me v 16.31M prior; Domestic Vehicle Sales: 12.55Me v 12.62M prior
- (CO) Colombia Monetary Policy Minutes


***Economic Data***
- (RO) Romania Dec International Reserves: $35.4B v $35.5B prior
- (IN) India Forex Reserves w/e Dec 27th: $295.7B v $295.5B prior
- (US) Dec ISM New York: 63.8 v 69.5 prior
- (DK) Denmark Dec Foreign Reserves (DKK): 485.9B v 489Be
- (US) DOE Crude: -7M v -1Me; Gasoline: +840K v -1Me; Distillate: +5.04M v -0.5Me
- (US) Weekly EIA Natural Gas Inventories: -97 bcf v -140 to -130 bcf expected range